Gloster Limited Vs Gloster Cables Limited & Ors. (Supreme Court of India)
Supreme Court: NCLT Cannot Decide Trademark Title Disputes Dehors Insolvency Process — ‘Gloster’ Trademark Not Automatically Vested in SRA
The Supreme Court held that the NCLT exceeded its jurisdiction in declaring that the trademark “Gloster” belonged to the Corporate Debtor (FGIL) and consequently to the Successful Resolution Applicant (Gloster Limited). While affirming that NCLT has jurisdiction under Section 60(5)(c) of the IBC to decide issues arising out of or in relation to insolvency proceedings, the Court clarified that this power does not extend to adjudicating independent and complex questions of trademark title where rival claims pre-exist and do not arise solely from the CIRP.
The Court noted that the approved resolution plan itself acknowledged rival claims over the trademark and merely recorded the Resolution Applicant’s belief that the assignment in favour of Gloster Cables Ltd. (GCL) was invalid. No avoidance application under Sections 43–45 of the IBC was filed by the Resolution Professional, and the plan was approved in full knowledge of the disputed ownership. In such circumstances, the NCLT could not, on the basis of an application under Section 60(5), grant a declaratory finding vesting title in the SRA.
Accordingly, the Supreme Court upheld the NCLAT’s decision setting aside the NCLT’s declaration on trademark ownership, while reiterating that insolvency fora cannot usurp the jurisdiction of civil courts or statutory authorities in matters that lie dehors the insolvency process.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
